Carnival Corp. says its cruise bookings for 2022 are not only sailing but running ahead of 2019 numbers – a good sign that guests will return once the pandemic has eased. The development is welcome news for Miami-based Carnival, which reported this week that it lost US$2.2 billion alone in the fourth quarter of quarter of 2020 (ending Nov. 30), compared to earnings of $427 million in the same period the year before.
The losses were part of a devastating year for the cruise industry, which had expected to welcome 30 million passengers worldwide in 2020. Instead, Carnival and others halted sailings in March 2020 after numerous ships reported coronavirus outbreaks on board.
Carnival resumed a limited amount of cruising in Italy in September and Germany in October, with lower passenger capacity and other safety restrictions. But operations were suspended in late October as coronavirus cases spiked across Europe.
Carnival’s Costa brand, which operates in Italy, is scheduled to restart operations on Jan. 31. Aida Cruises, the company’s German brand, has extended its pause through the end of February, and Carnival Cruise Line, the company’s biggest brand, has cancelled all US sailings through March 31.
Carnival says it is working on resuming cruises in Asia, Australia, and the US over the course of this year.
The company is confident customers will return as it slowly ramps up business. As of Dec. 20, bookings for the second half of 2021 were within historical ranges despite minimal advertising and marketing, Carnival said.
But limiting capacity on ships and adding new safety measures will cut into profits and the company says it expects to report a net loss in its 2021 fiscal year, which ends in November, though with $9.5 billion in cash on hand, and current operations funded through a mix of loans, equity offerings, and other financial transactions, Carnival is financially stable.
To raise cash and bring its fleet in line with anticipated demand, Carnival has accelerated the removal of less efficient ships, having sold or recycled 15 ships in its 2020 fiscal year, with four more expected to be sold or scrapped in the coming months. Prior to the coronavirus outbreak, the company had planned to dispose of those ships after several years.
Carnival is also adding fewer ships than planned to its fleet. The company recently took delivery of two new ships and expects to receive one more in 2021. Five ships were originally scheduled for delivery in 2021.